Can Dedicated Vehicle Navigation Device Manufacturers Find a Way Back From Irrelevance?

As reported by Daily Finance: Quick, when was the last time you bought a dedicated GPS/Navigation device? We're betting it's been awhile.

Sales of pure GPS/Navigation hardware units -- as opposed to devices that run navigation apps in addition to other software and functionality -- have plummeted in the U.S., from a high of 18 million in 2009 to 7.5 million just three years later.

The main culprit is advances in technology. These days, a user of Apple (AAPL) iDevices, Nokia's (NOK) phones and tablets or basically anything that runs on Google's (GOOG) Android operating system has a built-in app or a wealth of navigation software to choose from. Navigation apps are also usually far cheaper than a dedicated piece of hardware.

Not only that, but during the same time, navigation functionality made its way into the systems of automobiles, and once that segment was penetrated, there was no chance of a U-turn. These days, dashboard navigation -- typically bundled with apps to control other activities -- is a popular option in many car models.

In Need of a Compass
That's been a damaging trend for the companies in the GPS/Navigation device business. One that leaps immediately to mind was once nearly synonymous with the technology: Garmin (GRMN).

Smartphone navigation apps are taking over the market, and
with near real-time communication systems like those built
into Waze, they offer more functionality than stand alone units.

Once upon a time, Garmin was an investor favorite, with its shares touching $123 apiece in September 2007. The good times didn't last. As the GPS market broadened and offerings became more plentiful and cheaper, Garmin got lost in the woods. In 2008, its stock bottomed out at less than $15 per share.

Since then, Garmin has made a bit of a comeback thanks to its continued involvement in specialty GPS segments. 

The company trades in the $50 range now. Most notably it's doing well in aviation, where it saw a 25 percent year-over-year gain in revenue this past Q4. It's also managed to capitalize on the trend for wearable fitness monitoring products, posting nice gains in that segment as well.

But neither is going to make Garmin a growth stock. In that quarter, aviation took in around $70 million and fitness a bit under $120 million, neither of which was a massive contributor to the firm's $760 million in total revenue.

Despite some share-price-boosting optimism lately -- not least because Citigroup (C) released a glowing analyst note on the company in March -- both top and bottom lines for the company in fiscal 2013 were down notably from 2009, Garmin's heyday.

Poor Tom
Netherlands-based TomTom (TMOAF) -- loosely speaking, the Garmin of Europe -- has struggled for the same reasons. In the salad days of the last decade, its Nasdaq-traded stock nearly touched $30 per share; these days, it can be had for less than $7. Like Garmin, TomTom has struggled to broaden its product range with popular offerings -- a line of GPS-packed sports watches the company launched last year, for example, brings in only a fraction of the company's total revenue.

In-dash navigation systems are becoming standard for many vehicles - especially since the requirement for backup cameras in vehicles will soon be mandatory.  While driving the display screens for the backup camera can be used for operator and entertainment menus, as well as navigation.

Speaking of revenue, the top lines from three of the company's four business units were down notably in fiscal 2013. Only its telematics division saw a significant year-over-year increase during the year, growing by 16 percent to 85 million euros ($118 million).

That's encouraging, but the division (essentially, TomTom's products for businesses) is the smallest out of the four, taking in less than 7 percent of total revenue in 2013.

Driven Away
In a sense, both Garmin and TomTom have fallen victim to a classic cycle in business. They stood atop a specialty market, and profited handsomely from their niche, but are now fighting to stay relevant now that their core offerings are essentially commodity goods.

These days, you can find GPS functionality built into your cellphone, tablet, and the dashboard of your car. Who needs a dedicated device anymore?

Colorado Likely First To Legislatively Authorize Ride-Share Services

As reported by the Denver Post: Colorado is set to become the first state in the country to legislatively authorize ride-sharing services offered by UberX and Lyft.

The Senate on Tuesday approved a House-amended version of Senate Bill 125 that closes the controversial insurance gap, sending the bill to Gov. John Hickenlooper's desk.

Hickenlooper's office has urged lawmakers to pass the much-debated measure because without it, Lyft and UberX would be forced to cease operations in the state, dealing a blow to Colorado's reputation as an innovation hub.

SB 125 officially would authorize the services and place Lyft, UberX and other so-called transportation network companies, or TNCs, under limited state regulation.

Lawmakers in Arizona, California and Illinois also have taken up the issue of regulating ride-share companies. Arizona Gov. Jan Brewer vetoed her state's bill last week because of concerns about insurance coverage and lack of drug testing for drivers.

Ride-sharing drivers use their personal cars for fares and connect with passengers via smartphone apps. Fares generally are lower than taxi service. Taxi officials have argued the TNCs have an unfair advantage because they don't face the same regulations.

The final version of SB 125 requires car-sharing companies, or their drivers, to carry primary commercial insurance coverage for the period when a driver has logged into their Lyft or UberX app but hasn't been hailed. Insurers had threatened to raise rates if they were forced to cover that period with a driver's personal auto policy, arguing that the driver is engaged in commercial activity at that point.

"We were able to address that critical issue in making sure there were no gaps in coverage during the commercial activity, at least for liability coverage," said Kelly Campbell, a lobbyist with Property Casualty Insurers Association of America.

The bill allows TNCs to carry contingent coverage — which kicks in if a driver's personal policy doesn't cover damages — for the gap period until Jan. 15. At that time, the gap coverage has to be primary, either through the driver or the TNC.

SB 125 also requires TNCs to provide primary liability coverage between the time a fare has been hailed and the passenger has been dropped off.

"We look forward to Gov. Hickenlooper signing the bill to secure a future that will allow ride-sharing to grow and thrive in the state of Colorado for years to come," Lyft said in a statement.

Uber, the parent company of UberX, still has some concerns about certain regulatory controls the state will have over the ride-sharing service.

"All in all, it's a very good thing that this legislature cleared the way for TNCs to operate in Colorado," Uber attorney Greg Sopkin said.

Lyft launched service in Denver in September, with UberX following a few weeks later. Lyft has since expanded to Colorado Springs.

"We're the first in the nation to legislatively authorize this," Uber attorney Ray Gifford said. "That should be a point of pride for Colorado."

Sheriffs Crash $250k Drone They're Not Supposed To Be Flying

As reported by Chron: Divers scoured the bottom of Lake Conroe in the hope of recovering a controversial $250,000 police drone that crashed into the water Friday.  

The Montgomery County Sheriff's Office confirmed the remote-controlled helicopter drone, which was bought in 2011 with a federal grant, suffered a malfunction and went down during an exercise over the lake.  

The drone is equipped with a camera and an infrared scanning device and is used by MCSO for emergency management, missing-person recovery and operation overwatch, for example filming above SWAT team activities, spokesman Brady Fitzgerald said.

"Divers did go down to look for it. They are still looking. It went down in deep water where there is a rocky bottom. Visibility is also a problem because of sediment at the bottom of the lake," Fitzgerald said.

The mini helicopter, which weighs around 49 pounds, and, in a military setting, could be fitted with a single- or multiple-shot 40mm grenade launcher, 25mm grenade launcher or 12 gauge shotgun, according to Vanguard Defense Industries.

Civil liberties organizations were critical when the ShadowHawk drone was purchased from Vanguard just over two years ago.

At the time, Kirsten Bokenkamp, spokeswoman for the Houston-based American Civil Liberties Union of Texas, said the drones raise concerns because there are not enough safeguards in place to protect citizens from unreasonable search and seizure.

"It's just another example of technology that is outstripping our lives," she said. "What we mean by that, is the technology moves so quickly and the interpretations of the Fourth Amendment are failing to keep up with the technology. That brings privacy concerns."

MCSO officials emphasize that the drone is not used for surveillance.  

Drones or unmanned aircraft are governed by the Federal Aviation Administration, which first authorized their use in the national airspace in 1990.

Fitzgerald said deputies were confident the drone would be recovered and further investigation into the crash would follow.

The Drone is reportedly over the FAA's 25 pound weight limit, so it's likely they shouldn't have been flying it in the first place.  Recently passed Texas Legislature (House Bill 912) also restricts the use of drones to observe private property.

FCC Proposes $48,000 Fine To Man Jamming Cellphones On Florida Interstate

From the FCC: "An individual who had been jamming cellphone traffic on interstate 4 in Florida was located by FCC agents with the assistance of Hillsborough County Sheriff's Deputies. The individual had reportedly been jamming cellphone traffic on I-4 for two years.

The FCC is now proposing a $48,000 fine for his actions. They say the jamming 'could and may have had disastrous consequences by precluding the use of cell phones to reach life-saving 9-1-1 services provided by police, ambulance, and fire departments.'"  

While the fine is large, it is not unprecedented: last August (2013) a New Jersey man named Gary Bojczak, who worked for a construction company in Northern New Jersey was fined $32K for an illegal GPS jamming device that disrupted the Newark airport system on multiple occasions.  The FAA and FCC spent two years (March 2009 to April 2011) locating the source of the jamming at Newark Airport.

Wireless jamming is considered to be more than an inconvenience or nuisance, and is treated as a significant threat since it can disrupt critical and emergency communications, terrestrial and satellite communication such as GPS tracking systems that are required for everything from aircraft, personal or vehicular location to systems requiring financial trading.  It can also potentially affect military operations.

As GPS can be negatively impacted over a wide area by a relatively small jammer, alternative technologies such as eLoran and MEMS (microelectromechanical systems) are being investigated as a secondary location signal provider.  This will only continue to be more critical as self driving vehicles, commercial drones and intelligent highway system usage continues to expand.

Despite “Framily” Push, Sprint Continues To Bleed Customers

As reported by GigaOm: In January, Sprint launched a major new campaign to lure in new mobile subscribers and keep old ones loyal, but the potential benefits of its “Framily” program didn't show up in its first quarter results. The company shed nearly 400,000 subscribers as it struggles to get its LTE network rolled out nationwide and faces off against mega-carriers AT&T and Verizon as well as a newly resurgent T-Mobile.

Sprint lost a net total of 231,000 postpaid subscribers (which includes contract and non-contract subscribers who aren’t on a pay-as-you-go plans) and 364,000 prepaid subscribers. The bright spot was a gain in 212,000 wholesale subscribers, reflecting Sprint’s growing business in connecting mobile virtual network operators (MVNOs) like Tracfone, FreedomPop, Ting and Republic Wireless. The revenue it brings in from an MVNO subscriber, however, is a fraction of what it sees from a customer who buys mobile service directly from Sprint.

Sprint executives blamed the subscriber loss on the tumult created by its ongoing network overhaul. Sprint isn't just trying to bring its LTE network coverage on par with its competitors, but it’s also rebuilding its 2G and 3G CDMA networks from scratch. Service disruptions caused by that upgrade work are causing disgruntled customers to leave, Sprint said.

Still, there are some glimmers of light at the end of this tunnel. Sprint’s LTE network now reaches 225 million people in 443 cities, so it’s within spitting distance of its mid-year goal of 250 million people covered. And while Framily didn't stem customer losses this quarter, nearly 3 million subscribers signed up for the new friends and family plan last quarter. That’s significant but those customers are not only more likely to stick with Sprint in the future, but they’re likely to recruit new subscribers into the Sprint fold.

Framily’s incentive structure offers an increasing discount as more people join a particular plan. Since Sprint will bill each subscriber separately, Sprint can use Framily to target customers outside of a traditional family plan. These customers aren't on contract, so they’re free to leave when they pay off their phone, but they’ll lose their accrued discounts. So if a “Framily” loses members it has a lot of incentive to replace them. At a separate event Tuesday, Sprint attempted to amplify the benefits of Framily by offering members discounts on Spotify’s subscription music streaming service.

Sprint now has 54.9 million total subscribers, making it half the size of AT&T and Verizon. It reported a first quarter net loss of $151 million, compared to a $643 million loss in Q1 of 2013, off of revenue of $8.88 billion.

Saudi Arabia Joins the Drone Arms Race

As reported by The Verge: Last week, Saudi Arabia bought its first drone fleet, according to a dispatch from Tactical Reports. Saudi Crown Prince Salman met with Chinese General Wang Guanzhong to sign a contract for a shipment of Chinese Wing Loong drones, also known as Pterodactyls. The drones that make up the shipment are designed to mimic America's Predator drone, with surveillance capabilities and enough lift to carry two matched air-to-ground missiles.

If the report is true, it means Saudi Arabia may have joined an exclusive club, one of the few nations with armed, unmanned aircraft. It's a group that, to date, includes just the US, Britain, Israel, China, and (depending who you ask) Iran — but beyond those countries, the capability is increasingly available to whoever can pay for it. At the Singapore Air Show earlier this year, both Israel and China were showing off their wares to would-be clients, including the Pterodactyl drone named in the report, and you could find similar displays at dozens of other air shows. With American counterterrorism efforts providing an ongoing test of how valuable the machines can be, there are lots of countries willing to buy.

The US is still responsible for the vast majority of drone strikes, but that may have more to do with politics than capability. A GAO report from 2012 found that more than 75 countries have some form of drone system. Most are unarmed but some, like the systems used in Australia, Japan, and Singapore, could be retrofitted for military purpose. More importantly, the US’ use of drones — more than 50 strikes in 2013 alone — seems to have whetted a global appetite for combat drones. "If you think of this as part of a broader trend of the proliferation of military robotics, then the idea that we were going to have a monopoly on this kind of technology was always a bit far-fetched," says University of Pennsylvania political scientist Michael Horowitz. "The American monopoly on drones is over and probably never really existed."

International trade barriers have slowed down the spread, but they haven’t stopped it. For US companies, combat drones are controlled under the same agreement as cruise missiles, through an association called the Missile Technology Control Regime. But China and Israel aren't part of the group, and the two countries have begun aggressively marketing drone systems to outsiders eager to keep up with US capabilities. One report from the consulting firm Frost & Sullivan estimated that Israel had exported $4.6 billion in drone systems between 2005 and 2012.

Experts also say Saudi Arabia has previously demonstrated both the interest and the budget for this kind of purchase. "Saudi Arabia and smaller countries like the UAE are trying to get their hands on whatever they can, and the US has pretty restrictive export policies," says Cornell University professor Sarah Kreps, who studies drone proliferation. The result leaves China as one of the only sources available in town.

One of the biggest questions is whether the new generation of foreign drones can match US capabilities. "We don't know at all about the quality of the pterodactyl," Kreps cautions, "these aren't combat-tested." Since unmanned aircraft rely so heavily on satellite and communications infrastructure, it’s hard to tell from the craft alone how well it will perform in the field. The Pterodactyl is also typically sold for a fraction of the price of the Predator, which has only fueled skepticism.

But even if China needs help to bring its drones up to US standards, that expertise may not be hard to find. UAVs are built on mostly commercial technology, drawing from the robotics and aviation industries. That’s much harder to keep under wraps than military tech like warheads or missiles. As long as there’s a market, there’ll be an incentive to build cheaper and more powerful drones, and the club of drone-armed countries will continue to grow. As Horowitz puts it, "What we know about the history of military technology suggests it will be really difficult to keep a lid on this."

Google’s Self-Driving Car Logs 700,000 Miles Navigating City Streets

As reported by GigaOm: Google says its self-driving car is now proficient at navigating the hazards of city driving.

In a blog post, Chris Urmson, director of the company’s self-driving car project, wrote that the Google cars have successfully completed 700,000 miles of city driving — around Google’s Mountain View, California headquarters — without incident:

“We’ve improved our software so it can detect hundreds of distinct objects simultaneously — pedestrians, buses, a stop sign held up by a crossing guard, or a cyclist making gestures that indicate a possible turn. A self-driving vehicle can pay attention to all of these things in a way that a human physically can’t — and it never gets tired or distracted.”

As of the last status update in August, the cars had completed 300,000 miles of service without an accident, at least under computer control — an actual person also sits in the car — but those miles were logged in a variety of conditions. Now Google seems to have doubled down on city driving, which presents more variable conditions than highway driving.

While this post is interesting, the comments are even more intriguing. One commenter predicted an increase in unsafe driving practices by human drivers who will now be tempted to cut off the Google cars, if they’re so darned accurate. Another requested  an “On-Board Missile Launcher” option, perhaps to deter or punish such cutoffs and counter road rage.

While negotiating Mountain View roads may be tricky, Google needs talk to me after the cars have mastered the potholes, rotaries and creative drivers of Boston. Now that would really be something.